LOUISVILLE -- Elected leaders set the stage for the construction of an Alfalfa's Market grocery store on South Boulder Road with a unanimous vote Tuesday night to approve one of the most generous business incentive packages in the city's history.

Alfalfa's, which would locate a 22,000-square-foot store near the site of a long-abandoned Safeway at 707 E. South Boulder Road, would receive a full rebate of the sales tax revenues it generates in the first three years of operation -- capped at $800,000. The natural grocer would also get a 50 percent rebate of the use taxes and permit fees paid to the city.

According to Louisville Economic Development Director Aaron DeJong, the incentive package could amount to $1 million.

"This is an unprecedented business package we're considering, but this is an unprecedented opportunity," Councilwoman Emily Jasiak said. "Yes, it is aggressive, but I think this is an exciting opportunity."

Alfalfa's arrival in the city is tied to a larger redevelopment project, featuring a 110- to 120-unit apartment complex, that has been proposed for the corner of South Boulder Road and Centennial Drive. The $3.4 million store would enliven the shopping center that has fallen into further disrepair since the Safeway closed its doors in May 2010.

The larger redevelopment project must still gain city approval before the natural grocer would break ground. The Louisville Planning Commission takes a look at that proposal Oct.

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Mayor Pro Tem Hank Dalton asked Alfalfa's co-founder and chairman Mark Retzloff how financially healthy his business is and whether it will be in Louisville for the long haul.

"You're stretching the envelope of our experience and of our program," Dalton said of the city's business assistance packages.

Retzloff said Alfalfa's single location in downtown Boulder is in good shape after a sometimes-rocky start to its re-emergence on Broadway a few years ago.

"We have plenty of financing for our current location -- we just passed the break-even point (there) a few months earlier than we thought we would," he said. "We're in good shape right now."

Councilman Jay Keany asked if it is wise for the city to break its customary habit of limiting its rebate on sales tax revenues to 50 percent to businesses considering a move to the city. DeJong told him it is important to Alfalfa's that the package be "front-loaded" so that it could more easily ramp up in the first few years to sustainable sales levels.

He also said there are provisions in the incentive package that would protect Louisville's investment by requiring Alfalfa's to reimburse the city if it walks away from the site prematurely.

Earlier this year, Louisville residents inundated Alfalfa's with more than 500 letters and, according to Retzloff, "a drawer full of alfalfa seeds" as an appeal to the grocer to come to Louisville. The city, under community pressure, in June rejected an earlier redevelopment proposal for the Safeway site that relied on a more dense residential layout.

Retzloff said community enthusiasm, in addition to the aggressive incentive package, was critical to making things work for Alfalfa's in Louisville.

Mayor Bob Muckle said the alternative -- additional years of an underperforming shopping center that threatens to drag down the retail health of the entire South Boulder Road corridor -- is unacceptable.

The city estimates that an Alfalfa's would generate $3 million in sales tax revenues for Louisville over a decade and employ 100 full-time and part-time employees.

"There's just so many potential benefits, in addition to the desires of the community, to have a natural grocer in the city," he said.

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